Fewer affordable homes being built

There were over 33,300 new homes started in England in the 12 months to March 2016, excluding parts of London, of which the majority were affordable properties but fewer than the year before.

Overall there were 33,332 housing starts on site and 25,315 housing completions delivered through programmes managed by the Homes and Communities Agency (HCA) in England, excluding London for all programmes except those administered by the HCA on behalf of the Greater London Authority between 01 April 2015 and 31 March 2016.

The data shows that while the majority, 21,304 or 64%, of the housing starts on site in 2015/2016 were for affordable homes, this is a fall of 19% on the 26,458 affordable homes reported in 2014/2015.

The data also shows that of the 16,544 affordable homes started in 2015/2016 were for affordable rent, a decrease of 24% on the 21,879 started in 2014/2015 but the number for shared ownership sand other affordable schemes at 4,158 rose by 25%. The remaining 602 were for social rent, a decrease of 52%.

Some 17,394 or 69% of housing completions in 2015/2016 were for affordable homes, a fall of 57% on the 40,864 affordable homes completed in 2014/2015 but the report says that this reflects the normal peaks and troughs in delivery between programme periods, as the AHP 2011/2015 drew to a close in March 2015.

And 13,100 affordable homes completed in 2015/2016 were for affordable rent, a decrease of 58% on the 30,834 completed in 2014/2015 while 2,801 were for intermediate affordable housing schemes, including shared ownership, a decrease of 60% and the remaining 1,493 were for social rent, a decrease of 50%.

Of the affordable homes completed in 2015/2016, the AHP 2015/2018 accounted for 37%, the Affordable Homes Guarantees programme for 30% and the Affordable Homes Programme for 19%.

Richard Connolly, chief executive officer of Rentplus, described the figures as disappointing. ‘Given investment from the Homes and Communities Agency helps to build around half of new homes in England each year, today’s data makes for a disappointing read,’ he said.

‘Affordable housing starts have been on a steady decline over the last three years and in view of population growth and the endemic housing affordability crisis in the UK, this is the wrong track to be heading down. Our belief is that mixed tenure communities, offering a range of housing options to suit different needs, including rent-to-buy, are crucial to building a strong and sustainable UK property market,’ he explained.

‘Completions of homes for affordable rent also fell 58% annually which will put more pressure on an increasingly diminishing resource for people in housing need. Affordable rent to buy homes provide a viable and complementary alternative to traditional rented homes, helping the many people struggling to save for a deposit to buy due to rent now consuming around half of young people’s salaries,’ he added.

He also pointed out that the recent vote for the UK to leave the European Union means uncertain times and new housing starts are a likely victim. ‘Government efforts are likely to be focused on negotiating a European exit and the spotlight may fall off affordable housing, when it desperately needs to remain there,’ said Connolly.

‘Strong leadership is needed for the UK to navigate the times ahead, not just negotiating an exit in Brussels, but key domestic issues also. We now call on the government to include tenures such as affordable rent to buy within its definition of Starter Homes as part of the new Housing and Planning Act, which will open up home ownership to many more individuals,’ he concluded.

Written by: Houseladder